Congress has placed responsibility for internal controls squarely on senior management’s shoulders. Financial Reporting Fraud discusses, in detail, the role of senior management and the CPA in the prevention of financial reporting fraud.

Through case studies, you'll find explanations on:

Where to look for the fraud

Who is most likely to perpetrate the fraud

What the fraud will look like

What should be done to expose the fraud

What to do to cut down the risk of future fraud

Example scenarios and analysis illustrate key points, especially red flags that CPAs should be aware of. The guide also recommends procedures and controls that can prevent or diminish fraud.

Covers Financial Reporting Fraud in the World of IFRSs

Principles-based International Financial Reporting Standards (IFRSs) may give management an even greater degree of discretion than the more detailed and rules-based U.S. GAAP. Financial Reporting Fraud discusses how to avoid operating on the edge of GAAP or IFRSs permissibility, where internal controls are stretched so heavily, that, left unchecked, even one mistake in a seemingly small area can result in significant and drastic consequences.

Includes Discussion of Fraud as it Relates to COSO

The guide also discusses the seven most common occurrences of financial reporting fraud, in accordance with COSO’s research. These include:

Fictitious revenues

Premature revenues

Understatement of expenses and liabilities

Overstatement of assets

Fictitious assets

Capitalized expenditures that should be expensed

Misappropriation of assets

As a trusted adviser, when your clients look to you to guide them on procedures and controls to minimize or eliminate the risk of fraud in their organizations, you can look to Financial Reporting Fraud for answers.

About the Author

AICPA member Charles R. Lundelius, Jr., CPA, who also holds ABV and CFF designations, led a team from FTI Consulting to assist the SEC’s Inspector General in the investigation relating to why the SEC did not catch the Madoff Ponzi scheme. The Inspector General’s report, available at www.sec.gov, cites numerous findings by Mr. Lundelius’ team. Mr. Lundelius is Senior Managing Director - Forensic Litigation, FTI Consulting, Washington, DC.

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